Fee Roundup Survey Interview with KMOX Radio St. Louis
CreditCards.com Senior Industry Analyst Matt Schulz spoke on Monday, September 14, 2015, with Charlie Brennan of KMOX Radio St. Louis about the July 2015 Fee Roundup survey. The interview and transcript are below.
Charlie Brennan: On Friday we talked to an editor from SmarterTravel.com who said that these credit cards which you pay $75 or $150 per year to get frequent flyer points are not worth it. So we said ok, so what credit cards are worth it? And for that we go to Matt Schulz, Senior Analyst at Bankrate.com who is also with CreditCards.com, which I guess is a division of Bankrate. Is that right, Matt?
Matt Schulz: Yup, sure is.
Brennan: Well, ok. Let’s get straight to the point: I want to get a credit card that gives me cash back and has low fees – what do you recommend?
Schulz: Well, we looked at 100 major credit cards a little while ago to take a look overall at how many fees different cards have, and that sort of thing. And we found one card out of the 100 that we looked at that had no fees whatsoever. And it was the Pentagon Federal Credit Union Promise Visa card. So it doesn’t even charge you a fee, for example, if you pay late. So that was definitely kind of an island among those 100 cards we looked at.
Brennan: But do I have to work for the Pentagon to get it?
Schulz: You would have to be probably a government employee and that sort of thing. So it’s certainly not available to everybody.
Brennan: Alright, but our federal employees listening right now – in fact, I’m sure that a lot of federal employees are sitting around drinking coffee and listening to KMOX radio right now – just joking! Ok, aside from that, any other suggestions?
Schulz: Well, we found some other cards as well that have about three fees and there were some that were for businesses, including this Spark Classic Card from Capital One and a few variations of that. But also the Exxon Mobile Smart card, which is a gas station card, only has three fees as well. The problem with that is that those gas station cards tend to have high interest rates, so you just want to make sure that you can pay your balance off every month before you get that.
Brennan: How about a card that has low fees and gives me 1% or 2% back?
Schulz: One card that I tend to recommend as far as cash back is the Citi Double Cash card. And one thing when you’re looking at cash back, you kind of have to know if you’re a “spend it and forget it” person or if you’re somebody who wants to deal with rotating categories and that sort of thing, and the Citi Double Cash card, what it does is it gives you 1% back when you make the purchase and 1% back when you pay your bill. So basically that’s 2% and it has low fees so it’s a pretty good option.
Brennan: So that’s the Citi Double Cash card?
Brennan: What else should we know about credit cards if we’re in the market for getting one, Matt Schulz?
Schulz: Job number one for anybody with a credit card is to pay your balance off as soon as you possibly can and if you can’t pay it off at the end of every month, absolutely positively pay more than the minimum. If you just pay the minimum, that’s how those debts go really quickly.
Brennan: Yeah, for sure. And you examined all these credit cards. Are there some losers out there?
Schulz: Yeah, what we found is that there are two cards from First Premier Bank that had a total of 12 potential fees, which is obviously a lot. And those are cards that are targeted to folks who are either just getting started with credit or who don’t have very good credit. So what that really shows is that it’s so important to shop around when you’re looking for a card because you could have fees that run anywhere from just three fees to up to 12. So it’s so important to look around at sites like ours before you get a card.
Brennan: What are your opinions on these credit cards that help you accumulate points for American Airlines, Delta Airlines, or Southwest Airlines?
Schulz: I actually like them. And I’ve used them myself. I’m somebody who had a whole lot of credit card debt when I was younger and now I kind of put them to work for me. And if you are somebody who, again, can pay that balance off every single month, it can work for you. But if you can’t, then it’s a tough thing to do.
Brennan: But some complain, like our guest on Friday, that the miles are difficult to cash in and the fees are too high if they’re $75, $90 or $150 a year.
Schulz: Sure, and those are the sort of things that you have to watch out for. And the fact is that when you get the free travel, a lot of times it’s not quite as free as it was 10 years ago, but there are things that you can do and there are cards that allow you to gain points, for example, that aren’t specific to an airline, but instead that you just turn into statement credit money and it can end up working out for you pretty well.
Brennan: Matt Schulz, how do we get more information on this topic?
Schulz: We’ve got a lot of information at CreditCards.com to help you make smart choices about getting credit and using it.
Brennan: Thanks a lot for joining us today on KMOX. To be continued. Enjoy your Monday!
Schulz: You, too. Thanks a lot.
Brennan: Mr. Schulz, joining us on the KMOX guest line.